Sat, Sep 13, 2014 at 16:50
As Brent crude is nearing the 2-year low, investors are keenly buying Indian oil and stocks. The crude held above USD 98 a barrel on Friday, heading for its worst week in six as concerns over weak demand outweighed geopolitical worries in the Middle East and Ukraine.
The Oil & Gas index is up over 6 percent in a 1-month and almost 29 percent higher in year-to-date basis. So, if you still want to benefit from the oil & gas stocks, here’s help.
UBS prefers upstream companies given near-term operational catalysts, better balance sheets, ROEs and their relatively attractive valuations. It is cautious on marketing SOEs as risk-reward not compelling. Diesel de-regulation seems largely priced in, but not likely risk of higher 5 percent subsidy share – which if plays out could see 12-15 percent earnings downside.
Here is UBS trading guide on oil & gas stocks.